Loan cleared but status unpaid? Here’s what you need to do now

financialexpress.com:

Fully repaying your loan isn’t the final step to financial freedom. It’s crucial to ensure that your lender acknowledges the payment and updates the records accordingly. Occasionally, even after a loan, especially a personal loan, has been paid off, lenders might ask for the EMI payment. To pre-empt such occurrences, proactive vigilance and due diligence are recommended.

Should you encounter such a situation, swift action is imperative. Rectifying discrepancies promptly is crucial to prevent potential repercussions. To navigate this challenging scenario, here are steps to address this issue effectively.

Without any delay, start gathering every piece of documentation related to the loan. This includes receipts, transaction records, bank statements, and any correspondence exchanged during and after loan repayment. Comprehensive documentation serves as the cornerstone for substantiating your claim of having cleared the loan.

Directly contact the lending institution, presenting the collected evidence of payment. Approach this interaction with a composed and polite demeanour, elucidating the situation and presenting your case logically. Request the lender to rectify their records to accurately reflect the loan’s paid status.

Following any verbal communication, promptly send a follow-up email or letter summarising the discussion. Having a written record of your interaction can be invaluable, serving as a reference point for further proceedings.

Erroneous reporting can significantly impact your credit report. Credit information is furnished to bureaus. If the incorrect loan status is affecting your credit profile, raise a dispute with the respective credit bureau. Provide evidence of payment and request a thorough investigation